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SHAREHOLDERS EQUITY
 12 Months Ended
Dec. 29, 2024
SHAREHOLDERS EQUITY  
SHAREHOLDERS' EQUITY

NOTE 7 – SHAREHOLDERS’ EQUITY

 

On November 12, 2021, the Company completed a public offering of Units consisting of one share of common stock and one five-year stock purchase warrant to purchase one common share at $5.50. The Company has the right to redeem the warrants under certain conditions. We issued 2,400,000 common shares in the offering and 2,760,000 stock purchase warrants, which included 360,000 warrants to purchase an aggregate of 360,000 shares of common stock purchase pursuant to a partial exercise of the over-allotment option granted to underwriters for $.01 per warrant, totaling $3,600. The estimated fair value of the warrants at the date of issuance, net of the exercise proceeds, was $360,000, which is reflected as an additional cost of the offering. After deducting all fees and expenses, the net proceeds from the offering were $10,696,575. In 2018, we issued 3,708,000 common shares as part of the Share Exchange. Upon closing a related private offering, 205,002 additional common shares and 102,503 common stock warrants to purchase shares at $4.00 through July 31, 2024, were issued to investors for a net amount of approximately $492,266. During 2022, 13,612 public warrants were exercised for $74,866. The remaining warrants were outstanding as of the end of 2024. In addition, upon closing the private offering, the placement agent was issued an aggregate of 16,401 five-year stock purchase warrants to purchase shares at $3.30 per share, which are also outstanding at 2024.

 

On June 6, 2024, we authorized a stock repurchase program, under which we may repurchase up to 625,000 shares, or approximately 10.0%, of our currently issued and outstanding common stock (the “2024 Share Repurchase Program”). We have not established any maximum aggregate price to be paid for shares that we repurchase. As of December 29, 2024, we repurchased an aggregate of 306,394 including 91,394 shares under the 2024 Share Repurchase Program. We may purchase up to an additional 533,606 shares under the 2024 Share Repurchase Program. We are purchasing the shares with available cash and may repurchase shares of our common stock from time to time, in amounts, at prices, and at such times as we deem appropriate, subject to market conditions, legal requirements and other considerations. Our repurchases may be executed using open market purchases, unsolicited or solicited privately negotiated transactions or other transactions. The 2024 Share Repurchase Program does not obligate us to repurchase any specific number of shares and may be suspended, modified or terminated at any time without prior notice. The 2024 Share Repurchase Program does not contain a time limitation during which repurchases are permitted to occur.

 

Potential Sale and Issuance of Stock

 

On December 13, 2024, BT Brands, Inc. (the “Company”) entered into an Equity Distribution Agreement (the “Distribution Agreement ”) with Maxim Group LLC (“Maxim”) to sell shares of the Company's common stock, par value $0.002 per share (the “Common Stock”), subject to the maximum aggregate sales proceeds of up to $3,005,000 pursuant to the applicable prospectus supplement, from time to time, through an “at the market offering” program under which Maxim will act as sales agent.

 

Under the Distribution Agreement, the Company will set the parameters for the sale of shares, including the number of shares to be issued, the time period during which sales are requested to be made, any limitation on the number of shares that may be sold in any one day and any minimum price below which sales may not be made. Pursuant to General Instruction I.B.6 of Form S-3, the Company may not sell the shelf securities in a public primary offering with a value exceeding more than one-third of the aggregate market value of its voting and non-voting ordinary shares held by non-affiliates in any 12-month period as long as the aggregate market value of the Company's outstanding ordinary shares held by non-affiliates is less than $75 million. The $3,005,000 of shares of Common Stock that may be offered, issued and sold under the offering prospectus is included in the $25,000,000 of securities that may be offered, issued and sold by the Company under the base prospectus.

 

Subject to the terms and conditions of the Distribution Agreement, Maxim may sell the shares by any method deemed to be an “at the market offering” as defined in Rule 415(a)(4) promulgated under the Securities Act of 1933, as amended. Maxim agreed to use commercially reasonable efforts in conducting such sales activities consistent with its normal trading and sales practices and applicable state and federal laws, rules and regulations and the rules of The Nasdaq Stock Market LLC. The Distribution Agreement may be terminated by the Company or Maxim upon notice to the other party in accordance with the terms of the Distribution Agreement. The offering of the shares of Common Stock pursuant to the Distribution Agreement will terminate upon the termination of the Distribution Agreement in accordance with its terms.

 

The shares of Common Stock will be issued pursuant to the Company's shelf registration statement on Form S-3 (File No. 333-283830), filed with the Securities and Exchange Commission (the “SEC”) on December 13, 2024 (the “Registration Statement”). The Registration Statement was declared effective by the SEC on December 20, 2024. The Company will file a final prospectus supplement with the SEC following the effectiveness of the Registration Statement relating to the offer and sale of the shares of Common Stock pursuant to the Distribution Agreement.

 

The Distribution Agreement contains representations, warranties and covenants that are customary for transactions of this type. Under the terms of the Distribution Agreement, the Company will pay Maxim a commission in an amount equal to 3.0% of the aggregate gross proceeds from each sale of shares of Common Stock made under the Distribution Agreement and reimburse Maxim's expenses, including certain legal fees. The Company has no obligation to sell any shares of Common Stock under the Distribution Agreement and may at any time suspend solicitation and offers under the Distribution Agreement. The Company has also provided Maxim with customary indemnification and contribution rights. Maxim is not under any obligation to purchase any of the shares of Common Stock on a principal basis pursuant to the Distribution Agreement. Maxim's obligations to sell the shares of Common Stock under the Distribution Agreement are subject to the satisfaction of certain conditions, including customary closing conditions.